Corporate Welfare Queens
The NFL Can Punish Kneeling Players Because It’s a Private Corporation. Let’s Start Taxing It Like One.
It’s wrong for the league to punish true patriots protesting violence against minorities, but private businesses have the right to do so. It’s time they pay their fair share.
The NFL’s decision to practically require players to stand for the national anthem should serve as a wake-up call. Not because the decision is unconstitutional—but precisely because it isn’t.
For decades, Americans have treated sports leagues as though they’re part of the public square. That, after all, is why the national anthem is sung at football games to begin with: because these are civic occasions, supposedly, and time for us to all come together as Americans.
Only, that’s bullshit. If these were truly public occasions, they’d be bound by public law, the Constitution first and foremost. Which means the NFL wouldn’t be allowed to force players to stand for the national anthem any more than a public school can. (They can’t—but not every school has gotten the message.) In our constitutional democracy, the state can’t compel political speech, and that includes nonverbal “speech” like standing for the pledge of allegiance or national anthem.
But the NFL isn’t the state. It’s not even a “state actor,” a legal term referring to private organizations that serve public roles: Amtrak, for example. It’s a private trade organization, made up of 32 independent corporations—its teams. Its goal is profit maximization.
That’s why it reversed its 2017 decision not to penalize players taking a knee for the national anthem and implemented this new policy. That decision was bad for business. The core of the NFL’s fan base—white, middle- and working- class men who look a lot like the core of Donald Trump’s base— hated watching (mostly) black players “dishonor” the flag.
While liberals tried to point out that dissent is patriotic, that these players were actually honoring the flag by trying to call our country’s attention to police violence against people of color, conservatives saw it differently. They saw a bunch of uppity, ungrateful black men spitting in the face of America.
And they voted with their feet. The percentage of white men who said they “follow the NFL closely” dropped from 69 percent in 2014 to 47 percent in 2018—22 percentage points, or almost one-third of total fans.
Of course, many factors contributed to that decline—concussions and the league’s response to them, for starters—but the same survey also showed that Republicans were abandoning the NFL at twice the rate of Democrats. In the words of Newt Gingrich, speaking on Fox News of course, the fault lies with those “arrogant young millionaires” engaged in a “publicity stunt.”
In other words: It’s the money, stupid.
That’s why this week’s action should be a wake-up call. We need to stop treating the NFL like anything other than what it is: a for-profit association of billionaires (the average franchise value is $2.5 billion) that produces a product that hundreds of millions of Americans pay for.
That shouldn’t be news to anyone, and yet, it’s quite different from how the NFL, and professional sports in general, are regarded by fans and governments.
Until 2015, the NFL was technically a nonprofit trade association, because, it says, it distributed all its profits to its members. This despite the NFL’s $13 billion in annual revenues, and NFL Commissioner Roger Goodell’s $30 million salary.
And then there are the tax breaks.
The Dallas Cowboys, with an estimated value of over $4 billion, is the most valuable sports franchise in the world. But their owner, Jerry Jones, pays no property tax on his new stadium. That deprives Tarrant County, Texas, of $6 million per year. Maybe the Dallas Cowboys should be renamed the Dallas Corporate Welfare Queens.
Minneapolis’ U.S. Bank Stadium, where this year’s Super Bowl was played, may be named for a big bank, but half of its $1.1 billion cost was paid for by taxpayers, after Goodell warned state lawmakers that if they didn’t build a new stadium, the Vikings might head for greener pastures.
It should be called the U.S. Taxpayer Stadium.
Meanwhile, the Oakland Raiders—who moved to Los Angeles in 1980 when owner Al Davis didn’t get public funding for a stadium, then moved back to Oakland in 1995 when the city ponied up $200 million—are now headed to Las Vegas, where they’re getting $750 million in taxpayer subsidies. Jackpot!
The list goes on and on: San Diego, New Orleans, Kansas City, Pittsburgh, Atlanta, Cincinnati, and Arizona have all paid eight- or nine-digit bills in recent years to keep their beloved teams in town. (San Diego lost anyway, the Chargers are headed to L.A.) In fact, nearly every city with an NFL franchise has been extorted into paying for stadiums, parking, access roads, and the rest. I remember growing up in Tampa, where voters nixed a tiny tax increase to pay for public education, but approved a tax increase to pay for a new stadium for what was, at the time, the worst team in football.
And who gets the profits that are generated in those stadiums? Are cities repaid for their generosity? Of course not—all the profits go to multibillion-dollar private corporations, often owned by billionaire families.
Indeed, a 2013 report found that some teams actually made money on new stadium construction, receiving more public funds than were even needed to build the stadiums.
Even worse, all taxpayers subsidize this corporate welfare because the interest on municipal bonds is exempt from federal tax. An effort to close this loophole in the 2017 tax reform bill failed.
Meanwhile, because the NFL is exempt from antitrust laws, it keeps the number of franchises artificially low. It’s supply and demand: As long as there are fewer teams than there are cities that want one, the extortion racket can continue.
The total price tag of the NFL’s tax breaks is about $1 billion per year. That is pure corporate welfare, and it should be zeroed out. The antitrust exemption should go. And taxpayer funding of stadiums should be banned, pure and simple. This, too, is basic economics: The current system is a “race to the bottom,” in which cash-strapped cities keep outbidding one another to offer the best possible deal. And the only way to stop a race to the bottom is by some kind of agreement from the top.
So, when you see those players forced to stand for the national anthem (or, if they prefer, huddle in the locker room like outlaws), remind yourself that what you’re seeing is not a public spectacle, not a civic event, but for-profit entertainment.
There’s nothing wrong with that; movies and concerts are for-profit too, after all. But you don’t see the government spending $1 billion a year on Black Panther or Ariana Grande. We shouldn’t spend it on the NFL either.